The first-ever 14-19 learning network in Wales was set up in this deprived community to help attack high numbers of young people not involved in education, employment and training.
However, inspection body Estyn recently reported the network had mixed success to date and had been held back by a "limited amount of collaboration" between schools and colleges.
It concluded that Merthyr still has too many young people not learning and working. At 7.3 per cent, the number is above the Wales average of 6.4 per cent.
Estyn claims differing timetabling structures, a lack of opportunity to mix vocational and general qualifications and unnecessary duplication of courses are among the problems as the town tackles the unenviable position of having the most people on benefits in the UK and one of the highest teenage pregnancy rates in Europe.
Overall, learners achieve satisfactory standards but performance varies widely in the county borough's secondary schools. Teachers in all sectors were praised for good knowledge of subjects and engaging learners.
Estyn concedes the network has made "a good start in widening the choice of courses to learners".
The Merthyr Tydfil 14-19 network responded by saying it was the first of its kind to face inspection.